Seoul: South Korean stocks closed lower Wednesday, led by losses in major tech shares, as investors remained cautious amid valuation concerns over artificial intelligence (AI)-related stocks and uncertainty about the Federal Reserve's policy path. The local currency weakened against the U.S. dollar. The benchmark Korea Composite Stock Price Index (KOSPI) fell 24.11 points, or 0.61 percent, to close at 3,929.51, extending the losing streak to a second session.
According to Yonhap News Agency, trade volume was moderate at 330.78 million shares worth 14.26 trillion won (US$9.73 billion), with winners beating losers 463 to 417. The index opened markedly lower, tracking overnight losses on Wall Street, and had erased most of the losses on bargain hunting before finishing with a modest decline. Foreigners sold a net 1.05 trillion won worth of shares, while retail and institutional investors picked up a net 449.11 billion won and 625.52 billion won worth of shares, respectively.
Concerns about an AI bubble have persisted, as some institutions have reduced their exposure following recent rallies. Investors are focusing on Nvidia's quarterly earnings and its outlook for the sector. Eyes are also on the Fed's policy path amid mixed signals from its officials about a potential rate reduction. "The KOSPI's recent sharp declines amid repetitive negative factors have rather eased concerns about short-term overheating. Upcoming events, including Nvidia's results and the U.S. employment data for September set for Thursday, could lead to a potential market turnaround," said Han Ji-young, an analyst from Kiwoom Securities.
Tech shares lost ground amid valuation woes. Market bellwether Samsung Electronics fell 1.33 percent to 96,500 won, and chip giant SK hynix lost 1.4 percent to 562,000 won. Leading battery maker LG Energy Solution retreated 1.24 percent to 437,500 won, and nuclear power plant builder Doosan Enerbility went down 1.33 percent to 74,400 won.
Shipbuilders lost ground. Leading shipbuilder HD Hyundai Heavy dipped 4.81 percent to 574,000 won, and its rival Hanwha Ocean sank 3.76 percent to 123,000 won. Top automaker Hyundai Motor edged down 0.19 percent to 264,000 won and its sister affiliate Kia remained unchanged at 114,500 won. Defense giant Hanwha Aerospace slid 1.74 percent to 905,000 won, and leading financial group KB Financial shed 0.24 percent to 122,200 won.
The local currency was quoted at 1,465.6 won against the greenback at 3:30 p.m., down 0.3 won from the previous session.